Published On: Sun, Aug 21st, 2011

What Obama Should Do Right Now

Rigid Ideology Blocks Easy Economic Fix

You say you want to create jobs right now? You claim you’re anxious to break the back of the recession?  It’s really not that hard, but the answers are not likely to be found on an elite island off the coast of Massachusetts.

It’s been widely reported that Obama stopped into the “legendary” Bunch of Grapes bookstore in Vineyard Haven on Friday and picked up a copy of Aldous Huxley’s classic, “Brave New World”, ostensibly for his 13 year old daughter Malia.  One assumes that Obama himself is familiar with the book, and certainly with its content. Perhaps he’ll rely on some of its precepts while he works up his eagerly anticipated “jobs plan”.

Obama Leaves Bunch of Grapes Bookstore in Vineyard Haven

In the book, members of every class of society were indoctrinated by listening to repeated slogans while they slept, such as “every one works for everyone else, we can’t do without any one”, a process Huxley referred to as hypnopaedia. In the 21st century this technique has been so refined that the repetition takes place during   waking hours, with Obama and his surrogates repeating phrases such as “tax cuts for the rich”, “millionaires and billionaires”, and “tax breaks for corporate jet owners” at most every political event.

As Obama and his staff work up their plans on the Vineyard, can we expect anything other than the slogans we’ve already tired of and rejected?

All signs point to no.

Get ready for more taxes, more spending and more Massive Fail

On Wednesday the Washington Post reported that President Obama “has decided to press Congress for a new round of stimulus spending and tax cuts”, anticipates “proposing tax cuts for companies that hire workers” and will propose “new spending for roads and construction”. The New York Times had a similar take, noting that “…Obama has spent this week combining his pitch for deficit reduction with a renewed emphasis on the need for further temporary spending”.

We’ve done that. It hasn’t worked, it doesn’t work, it will never work. What will work?  It’s really not that tough to figure.

Remember the S&P downgrade from earlier this month? In their April warning they went on record and stated that “the U.S. is among the most flexible high-income nations, with both adaptable labor markets and a long track record of openness to capital flows” and that “the U.S.’s private sector is exceptionally innovative and competitive.

There’s your answer. Want more jobs? Unleash the private sector: stop smothering it with ideology, regulation and uncertainty.

In a 2008 Reason Magazine interview about her book, The Forgotten Man”, Amity Schlaes explained that “Scholars have overlooked the cost of uncertainty in an economy, what we would now call the “unknown unknowns.” Both the Hoover and Roo­sevelt administrations (but especially the Roosevelt administration) were so unpredictable. That hurt the economy very much, and when I went back and saw the extent I was astounded. Uncertainty is a factor that I thought needed to be explored. There were lots of people who said, “I will not invest ’til I know what’s going to happen.”

Schlaes went further in a 2008 Washington Post article: “In 1932, stunned market players and citizens wanted to know what the new rules were… uncertain, markets froze. Businesses refused to hire or invest in equipment.”

The Roosevelt schemes didn’t work. The economy didn’t pick up. Unemployment didn’t improve.

Henry Morgenthau was Roosevelt’s Secretary of Treasury between 1934 and 1945. In 1939 he appeared before the House Ways and Means committee and made this startling admission:

“We have tried spending money. We are spending more than we have ever spent before and it does not work. I want to see this country prosperous. I want to see people get a job. I want to see people get enough to eat. We have never made good on our promises. I say after eight years of this Administration we have just as much unemployment as when we started. … And an enormous debt to boot!”

Sound familiar?

Why Business sits on the Sidelines

Right now, American businesses are sitting on enormous cash reserves, estimated at $1.93 trillion as of last September.  The Obama team just can’t understand why business doesn’t want to get in the game. It would sure make their lives easier.

In February, EPA administrator Lisa Jackson complained that “even a portion of the $1.93 trillion invested in developing and installing new pollution control technology would result in good jobs right here for American workers.” Jackson made those remarks at a gathering of labor unions and environmental activists at something called the BlueGreen Alliance national conference in Washington, D.C. last February.

This is the same EPA that just finalized the Cross-State Air Pollution Rule that will cause power plants to close that generate up to 17% of America’s most affordable energy and will result in soaring increases in energy costs for consumers and businesses. Worse, it will cost jobs at a time when we’re supposed to be adding them.

In July, the New York Times trumpeted the good news while gushing that there would be “an additional cost to utilities of less than $1 billion a year”! Imagine that.

The usually reliable Obama ally Unions for Jobs and the Environment estimates that this will lead ro a loss of a quarter of a million jobs, while others estimate the total will be much steeper: up to 2.5 million lost jobs and as much as $7 trillion decline in economic output  by 2029.

By last week, even the lap dogs at the New York Times seem to have seen the light.  An article on Thursday headlined Number of Green Jobs Fails to Live Up to Promises reported that “Federal and state efforts to stimulate creation of green jobs have largely failed, government records show.

Maxine Waters has figured it out. Nonexistent green jobs will not lead to jobs for Blacks.

Two years after it was awarded $186 million in federal stimulus money to weatherize drafty homes, California has spent only a little over half that sum and has so far created the equivalent of just 538 full-time jobs in the last quarter, according to the State Department of Community Services and Development.”

Even Maxine Waters has come to the conclusion that the White House jobs policy is just “a lot of talk”.

The worst part of it is that none of it matters. Even if the entire Western Hemisphere completely eliminated all carbon dioxide emissions, the effect on global emissions would be offset by increased emissions from China within ten years. So why are we doing it?

Get the Motor Running

Want those jobs back?  Get out of the way.

  • Work with Congress to quickly slash corporate tax rates to single digits or less, and make American companies want to be American companies again and not have to take jobs and profits  offshore.
  • Suspend onerous regulations (like those proposed by the EPA) for five years to ten at least, and quit trying to push socialism under the cover of green.
  • Encourage real energy jobs in the oil fields of the Northwest and let the natural gas industry fulfill its potential. Leave the green job fantasy to the hippies and radical leftists.
  • Quit trying to convince the voters that we need to spend more money on stimulus or raise taxes: they see through all that.
  • Perhaps most importantly, commit to a sensible program that ends uncertainty and lets the indomitable motor of American enterprise begin to pull us out of the ditch.

Mr. President, if you announced a program like this, the markets would jump, unemployment would start to drop significantly within 60 days, GDP would begin to grow again.  And it wouldn’t be “unexpected”

Best of all?  You and Michelle could stay at the Vineyard until January 2013, and then everyone would be happy.

About the Author

- Russell Halley is a lifelong political voyeur. Halley started writing for weekly newspapers in the early 70's, and advanced to a successful career as a freelancer, having been published in several national magazines. Eventually, however, the call of commerce lured him away and he switched to circulation, working with many of the largest publishers around the world to increase readership. As an avocation, Russell has always followed and participated in the minutia of the political world, and migrated from a severe left wing point of view to conservatism. He was flattered when the San Jose Mercury News once described his style as “Republican Punk”, and prides himself on a certain expertise in this arena, with a perspective that he hopes sheds light on the issues of the day. Read more of Halley's clips here.

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  1. Kevin Cabral says:

    I’m actually for drilling unlike most who live on the Gulf Coast who fear another disaster. I think they made a good effort with the cleanup unlike the aftermath in the wake of Katrina, but regulations and oversight definitly need work as we cannot afford another drop of oil spilled into the gulf. With regulations currently in effect oil companies are only partially liable for cleanup costs.Cleanup is costly to the enviornment and the consumer at the pump. As you probably realise being as old as we are 100 years comes around very fast and the way our government works it looks like that won’t be enogh time for being prepared for the total depletion of reserves. In 100 hodred years there won’t be oil for my grandchildren. In the scheme of things thats just a blink of the eye.

  2. Kevin Cabral says:

    Russ,
    I’m not sure your graph is the best example for the point you are trying to make. As You can see the stock market Yes crashed during the term of Herbert Hoover a republican. As your graph shows the new deal came in at the peak of unemployment and then steadily declined under the term of Roosevelt until it reached a low of under 3%. I also wonder why you used this particular graph that shows the rate for farmworkers and not one that shows the total unemployment. I might also point out that the tax breaks for the wealthiest Americans have been in effect since 2001, they were supposed to stimulate job growth. So where are the jobs? Those tax cuts are still in effect, so where are the jobs. From a surplus in the Government coffers under the Clinton Administration we have gone into an exponentiallly expanding debt crisis. As any household can tell you the deeper you go into debt the harder it is to get out of it. The new deal provided stimulus money that was used wisely to build and expand the infrastructure of the nation and to provide jobs for the unemployed. What we need to focus on is the same. Yes, stop the unnesessary entitlements, most Americans would rather be working than collecting unemployment. We need programs to put Americans back to work and we need work done. Our infrastructure is crumbling our energy needs are expanding and little progress is being made. Why pay unemployment benifits when the same money can be spent building wind turbines, solar panels etc. Green technologies are not a fantasy, there is only so much fossil fuels left on the planet. When those are completely exhausted the hippies with there solar panels and wind turbines will be sitting comfortable in there homes watching TV while the rest of the power grid shuts down. It seems to me if we set up programs that would employ the unemployed in the task of building the energy infrastructure through the green technologies already available to us we can kill two birds with one stone. In this case three as we can lessen our dependancy on foreign oil which at $4.00 a gallon is bleeding us dry at a rate of $13,000,000 an hour thats almost 114 billion per year. Instead our two parties are finger pointing instead of working toward a common cause. What I see is all talk and no action. Who gives a damn that the President takes a vacation, do you really think any other president would stop taking vacations? Where the hell is all of congress anyway?
    Yes we need deregulation, but in a sensible manner. We can go too far with deregulation, example being the collapse of the financial sector. Yes we need to bring jobs back to the USA. Yes we need to exploit our own limited resourses, but what do we do when they are gone. We need a permanent solution which means that we need to take profits from our resources and invest them in a permanent solution. Do you really think that will happen if the private sector has there way, unregulated. Not a chance.
    A quote from the Times article you referenced.”Federal and state efforts to stimulate creation of green jobs have largely failed, government records show. Two years after it was awarded $186 million in federal stimulus money to weatherize drafty homes, California has spent only a little over half that sum and has so far created the equivalent of just 538 full-time jobs in the last quarter, according to the State Department of Community Services and Development.” Isn’t that under the leadership of the Governator? By the way $186 mil is a drop in the bucket thats about the cost of one stealth fighter.
    By the way the repeat of retoric is not a trait that is owned by the Democratic Party. I’ve been hearing the same thing from both parties for as long as I can remember. One thing you never hear though is having a complete overhaul of the system, that would cost too many jobs, namely those of our politicians.

    Kevin Cabral

    • Anonymous says:

      Kevin, of course I disagree. The 3% was during WWII. It was only the war and the massive demand for the war effort that saved Roosevelt. Before the war his policies never took unemployment below 20%… in 8 years. And the chart is for NON farm workers.
      .
      Of course, I also think that the green jobs ARE a complete fantasy. I mean, I think its fine to look for ways to achieve green energy, but as of this point in time, there is no solution there and no industry there, IMHO. Sure, there is only so much fossil fuel, but between oil (of which the US has the highest reserves on the planet, coal and Natural Gas, we have perhaps 100 years. I am not saying we should kicj back and only count on that, but I don’t think we should move towards technology and energy sources that don’t actually exist. As you can imagine, I’m in the drill here drill now crowd. It makes no sense to me to prevent drilling off the Florida coast when the Cubans are inviting the Chinese to do exactly that.
      .
      I would be happy if Obama took the next 17 months (the last he’ll have in office) and spent it on vacation, but I do not admire a man with no plan on jobs (after 2 1/2 years) who should be at work, not golfing.
      .
      Finally – don’t think I believe that the Republicans have covered themselves in glory on these issues…

  3. Stan Manoogian says:

    Russ, he should resign. That’s what he should do next. We’ll give him a corporate jet and a couple helicopters to use in order to make any number of tee times, just leave, now.

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